Musings: Navigating the Fjords

I spent some time with planning director Mike Dahilig recently, trying to penetrate the opaque world of transient vacation rentals (TVRs) on Kauai. After reading The Garden Island's article, “Planning commissioners frustrated over TVR issues,” it seems like a good time to share some of what transpired.

First, though, I'd like to address two comments that were left on Tuesday's post because they speak to the underlying problem with Ordinance 904, which allows TVR owners on ag lands to apply for permits to legitimize their operations. One person wrote: "You can't "grandfather" in an illegal use." 
This was followed by the reply: “You can render it legal by granting it a special use permit.”

That's false, but certain council members and the mayor, driven by fear that we'd be sued for a “taking,” pretended like it wasn't so they could pass 904. And the county attorney's office was right there, pounding that drum.

Under 904, ag land TVR owners must obtain both a special use permit and a non-conforming use certificate. However, a non-conforming use certificate assumes an operation or activity was legal up until the time the law changed. So all those people who had no special use permit for their ag vacation rentals were operating illegally, and thus are not qualified for a non-conforming use permit.

Yet here they are, applying for and getting those very same permits. Is it any wonder that planning commissioners are frustrated, and justifiably feeling, in the words of Commissioner Hartwell Blake, that these resort uses in the middle of an ag district are “spot zoning?”

Nor is it any wonder, given the underlying contradiction within 904, that its implementation has been accompanied by a mish-mash of conditions that have not been uniformly imposed on all applicants.

Under current state law (Chapter 205), all dwellings on ag land must be associated with farming activities. As Mike noted:

“If we had a definition of a farm dwelling under 205, we wouldn't have this issue of what is a farm. We're dealing with attorneys that try to pass off a couple of papaya trees in the front yard as a farm. I would love the Legislature to give us a definition of a farm.”

The way the county has decided to handle this pesky need for a farm is not to require one outright, but to impose a condition for an agricultural easement. But this doesn't kick in until the applicant comes in for renewal. At that time, if the county determines there's no farm they may assign a farmer to come in and work the land. The process of assigning a farmer, however, hasn't been fully worked out.

As Mike explained it:

The discussion we've had is to look at this as a deterrent. If the county says you've got to let a stranger on your land, you may not want to do TVRs. You've got to get going on a farm or you may have some stranger on your property.

It could be said we're ruling with a stick, rather than a carrot on this one. They're supposed to do ag activities. Our position is you have to have legitimate ag activity. That's what we would look at in terms of enforcement down the road.”

Some applications with this ag easement have been approved, Mike said, though the applicants' attorneys have gone on record objecting to what they consider an arbitrary and capricious condition. “It's up to them to challenge it.”

The department only came up with that condition fairly recently, so it wasn't imposed on some of the first applicants. “It's been a constant adjustment as we get new ideas,” Mike said.

Questions also have been raised about the uniform wording of the TVR applications, and the lack of any critical analysis in the staff report. As The Garden Island reported:

Commissioner Caven Raco found it “disturbing” that two applicants represented by two different attorneys from two distinct firms had applications which were written almost identically. He was referring to an application by Bruce and Cynthia Fehring being written almost identically to a previous application.

Raco questioned if the department was even reading the applications, which prompted planner Michael Laureta to take offense and answer that he does read all applications.

Dahilig defended his staff, saying they do their reports independently and have no control over the product that comes to them.

“If the applicant chooses to pay a consultant, it’s his choice,” Dahilig said.

Actually, what Mike Dahilig told me is that applicants are using a template developed by the planning department. But even though all the applications may look the same “it behooves my department to do a separate set of due diligence. We want to make sure there is an inspection, rather than just take an applicant's word for it.”

So is Mike Laureta, who used to be colleagues with so many of the attorneys who represent ag TVR owners, performing that due diligence well? His boss, Mike Dahilig, seems to think so:

We've rejected a number of applications. We've bounced a lot for i's dotted and t's crossed. Then we look at how legitimate are you. In some cases, we talked them down and they withdrew. We're left with a pool of 60-odd applicants. Our office has done a pretty diligent effort to require them to meet the very high standards of a special use permit.

When asked whether he thinks all those operating TVRs on ag lands have applied for permits, Mike said no. When asked what the county planned to do about it, he replied, “It's one of those on the to-do list items. We know who the culprits are out there.”

In the meantime, since the county conducts enforcement primarily on a complaint basis, citizens are placed in the position of having to observe and rat out neighbors. This becomes especially crucial in regard to TVRs, which must come in for renewals. As Mike explained:

Our authority to withhold [a permit] is based off of my discretion of whether there are land use violations. As the year goes along, we catalog complaints and determine if there is enough to do an investigation. If it is in violative fashion, they won't get their [TVR] certificate back.

Mike said the department has been scrambling to process the 904 applications by the mid-March deadline, while also trying to interpret some of the more “gray areas” in state law:

It really is like navigating a tanker through the fjords. You get close to running up on a reef. Or who knows, we may already be spilling oil.